Republic of the Philippines
Department of Labor and Employment
NATIONAL LABOR RELATIONS COMMISSION
National Capital Region
Banawe St., Quezon City
FIFTH DIVISION
DOROTEO A. GUAB,
Complainant-Appellee,
NLRC CN. RAB-IV-02-00332-18-
B
- versus -
NLRC LAC NO. 04-001373-19
JAM TRANSIT, INC.
DENNISE C. TRAJANO,
Respondents-Appellants.
x----------------------------------------------------------------------------------x
MOTION FOR RECONSIDERATION
Respondents-appellants JAM TRANSIT INC. (“JAM Transit”)
& DENNISE C. TRAJANO (“TRAJANO”), by counsel, most
respectfully move for the reconsideration of the Honorable
Commission’s Decision dated 31 May 2019, a copy of which was
received by Respondents-applellants on July 3, 2019, and in
support thereof, states:
1. In its Decision, the Honorable Commission denied the
appeal of Respondents-appellants and affirmed the 26 February
2019 Decision of Labor Arbited Melchisedek A. Guan finding that
JAM Transit illegally dismissed Complainant-Appellee, directing
the former to reinstate the latter to his former or equivalent
position and directing JAM Transit to pay Complainant-Appellee
the sum of Two Hundred Fifty Thousand Eight Hundred Fifty
One Pesos & 48/100 (P250, 851.48).
2. Respondents-appellants respectfully take exception to
the foregoing findings.
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3. A review of the records of the above-captioned labor
complaint would very plainly show that Respondents-appellants
were able to adduce sufficient and convincing evidence that they
had just cause to terminate Complainant-appellees’ employment.
4. D
5. the Complainants-appellees received the Motion for
Reconsideration filed by the Respondent-appellant Pinecrest
Condominium Corporation (“Respondent-appellant”).
6. A reading of the aforesaid Motion for Reconsideration
will readily show that Respondent-appellant blatantly failed to
show any palpable and patent errors committed by the Honorable
Commission that would result in the reconsideration of its
Decision dated April 30, 2018.
7. Accordingly, the aforesaid Motion is a mere scrap of
paper without force and effect that should be denied outright by
the Honorable Commission.
8. Specifically, the Respondent-appellant raised the
followings issues, to wit:
a. Respondent MRD Manpower Services is an
independent and legitimate job contractor;
b. Complainants-appellees are employees of
Respondent MRD Manpower Services and not of
Respondent-appellant;
c. Respondent-appellant did not dismiss the
employment of Complainants-appellants; and
d. The absence of a proper verification is a
cause to treat the pleading as unsigned and
dismissible.
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The sweeping allegations are baseless and unfounded,
intentionally fabricated by Respondent-appellant only to
suit up their ailing cause.
9. First, the Respondent-appellant argues that the
Honorable Commission committed an error when it held that
respondent MDR Manpower Services (“Respondent MDR”) is
engaged in labor only contracting despite the evidence to the
contrary.
We beg to disagree.
10. In the case of Petron Corporation vs. Armz Caberte, et.
al., G.R. No. 182255; June 15, 2015, the Supreme Court
distinguished permissible job contracting or subcontracting from
labor-only contracting, to wit:
As defined under Article 106 of the Labor Code, labor-
only contracting, a prohibited act, is an arrangement
where the contractor, who does not have substantial capital
or investment in the form of tools, equipment, machineries,
work premises, among others, supplies workers to an
employer and the workers recruited are performing
activities which are directly related to the principal
business of such employer.
Permissible or legitimate job contracting or
subcontracting, on the other hand, “refers to an
arrangement whereby a principal agrees to put out or farm
out with the contractor or subcontractor the performance
or completion of a specific job, work, or service within a
definite or predetermined period, regardless of whether
such job, work, or service is to be performed or completed
within or outside the premises of the principal. A person is
considered engaged in legitimate job contracting or
subcontracting if the following conditions concur: (a) the
contractor carries on a distinct and independent business
and partakes the contract work on his account under his
own responsibility according to his own manner and
method, free from the control and direction of his employer
or principal in all matters connected with the performance
of his work except as to the results thereof; (b) the
contractor has substantial capital or investment; and (c)
the agreement between the principal and the contractor or
subcontractor assures the contractual employees’
entitlement to all labor and occupational safety and health
standards, free exercise of the right to self-organization,
security of tenure, and social welfare benefits (Emphasis
and underscoring supplied and citation omitted).
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11. Applying the foregoing conditions, the Honorable
Commission is correct in ruling that respondent MDR Manpower
Services is a mere labor-only contractor because of the following
grounds:
a. Failure of respondent MDR Manpower Services to
secure a Certificate of Authority to act as an independent
contractor duly issued by the Department of Labor and
Employment (“DOLE”).
Section 14 of DOLE Department Order No. 18-A (“D.O.
No.18-A”) makes it mandatory for all persons or entities,
including cooperatives, acting as contractors to register with the
Regional Office of the Department of Labor and Employment
where it principally operates; otherwise, failure to register
shall give rise to the presumption that the contractor is
engaged in labor-only contracting.
b. Evident lack of substantial capital necessary in the
conduct of its business.
As expressly provided in Section 3(i) of D.O. No.18-A, a
single proprietorship shall have a net worth of at least Three
Million Pesos (P3,000,000.00) in order to be considered to have
a substantial capital.
c. Failure to prove that respondent MDR had substantial
capital or investment in the form of tools, equipment, machineries
and work premises.
In this case, respondent MDR and Darwisha Ramos have
admitted that they merely provided manpower to Respondent-
appellant. The latter likewise admitted in paragraph 10 of its
Position Paper dated July 26, 2017 that, in 2011, Respondent-
appellant engaged the services of respondent Darwisha Ramos to
supply manpower- housekeeping/janitorial services, building
technicians, gardener and pool attendant.
Since Respondent-appellant failed to adduce evidence that
respondent MDR had any substantial capital, investment or
assets to perform the work contracted for, the presumption that
respondent MDR is a labor-only contractor stands.
d. Respondent-appellant and respondent MDR opted to
do away with a written manpower services contract.
Section 4 of D.O. No. 18-A makes the execution of a Service
Agreement between the principal and the contractor, which
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ensures compliance with all the rights and benefits under Labor
Laws, as a requisite for a permissible job contracting or
subcontracting.
Relative thereto, Section 9 of D.O. No. 18 provides that a
Service Agreement shall include the following: 1) the specific
description of the job, work or service being subcontracted; 2) the
place of work and terms and conditions governing the contracting
arrangement; 3) provisions ensuring compliance with all the
rights and benefits of the employees under the Labor Code and
these Rules on: provision for safe and healthful working
conditions; labor standards such as, service incentive leave, rest
days, overtime pay, 13th month pay and separation pay;
retirement benefits; contributions and remittance of SSS,
Philhealth, Pag-Ibig Fund, and other welfare benefits; the right to
self-organization, collective bargaining and peaceful concerted
action; and the right to security of tenure; 4) a provision on the
Net Financial Contracting Capacity of the contractor, which must
be equal to the total contract cost; and 5) term or duration of
engagement.
In this case, the act of Respondent-appellant and
respondent MDR in failing to execute a Service Agreement is an
indication to circumvent, if not to evade, the minimum
requirements provided by law and existing regulations. The
agreement between Respondent-appellant and Complainants-
appellees is likewise highly unusual and suspect as to the
absence of a written contract specifying the performance of a
specified service, the nature and extent of the service or work to
be done and the term and duration of the relationship.
e. Complainants-appellees were recruited, placed and
performed activities which are usually necessary or desirable to
the operation of Respondent-appellant. In this case, there is a
reasonable connection between the particular activity performed
by the building technicians, housekeeping and janitorial services,
gardeners and pool attendants and the usual business of
Respondent-appellant, particularly in the maintenance of the
condominium unit.
The work of Complainants-appellees as technicians,
janitors, gardeners and pool attendant could only be
characterized as part of, or at least clearly related to, and in the
pursuit of, Respondent-appellant’s business. Logically, when
Complainants-appellees were assigned by respondent MDR to
Respondent-appellant, respondent MDR acted merely as an agent
of the principal. Hence, there is a presumption it is merely a
labor-only contractor.
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f. Respondent MDR admitted that it did not exercise
direct control and supervision over the complainants as
employees.
Even granting that respondent has a substantial capital to
operate as a job contractor (which is denied), the Honorable
Commission is correct in ruling that there can still be a labor only
contracting arrangement if it can be proven that the principal,
Respondent-appellant in this case, has retained the right to
control or in fact exercised the right of control and supervision
over the contractor’s employees.
g. Respondent MDR has no other client except for
Respondent-appellant and neither Respondent-appellant nor
respondent MDR refuted this fact, thereby bolstering the
Honorable Commission’s finding that BMSI is a labor-only
contractor.
If respondent MDR were a going concern, it would have
other clients to which to assign herein Complainants- appellees
after Respondent-appellant, through Mr. Cyruz M. Tingzon,
issued a Notice of Termination of Agency dated December 8,
2016. On the contrary, Complainants-appellees continued their
employment with Respondent-appellant even after the
termination of respondent MDR’s services. Since there is only
one client, Respondent-appellant, it is easy to conclude that
respondent MDR is a mere supplier of labor.
12. Let it be noted that the law presumes a contractor to
be a labor-only contractor and the employees are not expected to
prove the negative fact that the contractor is a labor-only
contractor (Polyfoam-RGC International, Corp vs. Edgardo Concepcion, G.R. No.
172349, June 13, 2012 citing 7K Corporation v. National Labor Relations
Commission, G.R. No. 148490, November Thus, it is not
22, 2006).
Complainants-appellees but Respondent-appellant which bears
the burden of establishing that respondent MDR is not a labor-
only contractor but a legitimate independent contractor.
13. Based from the foregoing, it is clear that Respondent-
appellant failed to discharge its burden of proving that
respondent MDR is not a labor-only contractor. Consequently, it
is pristine clear that the Honorable Commission did not commit
any error in ruling that respondent MDR is a mere labor-only
contractor.
14. Second, Respondent-appellant argues that herein
Complainants-appellee are not their employees but of respondent
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MDR. To overcome the presumption of being considered as the
direct employer, Respondent-appellant simply banks on the four-
fold test of employer-employee relationship which is allegedly
found to exist with respondent MDR.
The contention, however, is incorrect.
15. It is noteworthy that Respondent-appellant is estopped
from denying that it is not an employer of Complainant’s-
appellees. First, Mr. Sylvester Awing who is the former Property
Manager of Respondent-appellant issued a Certification dated
August 10, 2015 certifying that Complainant-appellant Renato B.
Burgos is an employee of Respondent-appellant PineCrest
Condominium Corporation. A copy of the said Certification is
previously attached as Annex “B” in Complainants-appellees
Position Paper. Second, Respondent-appellant retained the
services of herein Complainants-appellees even after the issuance
of the Notice of Termination of Agency dated December 8, 2015
until they were illegally dismissed from employment on February
25, 2017.
16. More importantly, the last sentence of Article 106 of
the Labor Code expressly provides that in case of labor-only
contracting, the person or intermediary shall be considered
merely as an agent of the employer who shall be responsible
to the workers in the same manner and extent as if the latter
were directly employed by him.
17. Similarly and again as correctly held by the Honorable
Commission, even if the four-fold test of employer-employee
relationship is found to be with respondent MDR (which is
denied), this fact alone will not absolve Respondent-appellant,
being the principal in this case, from being declared as the direct
employer of Complainants-appellees. This is because the express
mandate of Article 106, paragraph 4 of the Labor Code, as
amended, which is the statutory basis of legitimate contracting
and subcontracting, shall prevail.
Thus, notwithstanding the fact that all the elements of
employer-employee relationship is with the contractor,
jurisprudence is replete with rulings that a finding that a
contractor is a ‘labor-only’ contractor is equivalent to declaring
that there is an employer-employee relationship between the
principal and the employees of the supposed contractor, and the
‘labor-only’ contractor is considered as a mere agent of the
principal, the real employer (Petron Corporation vs. Armz Caberte, et. al.,
G.R. No. 182255; June 15, 2015 citing Aboitiz Haulers, Inc. v. Dimapatoi, 533 Phil.
566, 579-580 [2006]).
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18. Accordingly in this case, Respondent-appellant is the
principal employer and respondent MDR is the labor-only
contractor. Considering that an employer-employee relationship
exists between Respondent-appellant and Complainant’s-
appellees, the latter shall be considered regular employees in view
of the fact that they have been regularly performing activities
which are necessary and desirable to the usual business of
Respondent-appellant for a number of years.
19. Third, the Respondent-appellant argues that it had no
hand in the loss of employment of Complainants-appellees as it
should only be respondent MDR and its owner, Darwisha Ramos,
who should be considered as the employer.
The argument does not hold water.
20. As regular employees of Respondent-appellant,
Complainants-appellants were entitled to security of tenure and
could only be dismissed for just or authorized causes and after
they had been accorded due process.
The settled rule is that in termination proceedings of
employees, procedural due process consists of the twin
requirements of notice and hearing. The employer must furnish
the employee with two written notices before the termination of
employment can be effected: (1) the first apprises the employee of
the particular acts or omissions for which his dismissal is sought;
and (2) the second informs the employee of the employer's
decision to dismiss him (Distribution & Control Products, Inc. vs. Santos, G.R.
No. 212616, July 10, 2017).
In the instant case, both the Honorable Commission and
Labor Arbiter Jose Antonio C. Ferrer again uniformly ruled that
Complainants-appellees were dismissed sans procedural due
process. Complainants-appellees were not served notices
informing them of the particular acts for which their dismissal
was sought, and were not given an opportunity to explain their
side. Clearly, Complainants-appellees were not afforded due
process.
As to the required notice of termination, Respondent-
appellant alleges that it did not terminate Complainants-appellees
from their employment and that it was the latter who actually
decided to abandon their respective job. However, the Honorable
Commission and the Labor Arbiter again unanimously found that
Respondent-appellant failed to substantiate their allegation.
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21. Respondent-appellant further contends that herein
Complainants-appellees lost their employment when the former
terminated its agreement with respondent MDR. However, the
termination of the agreement to supply manpower services cannot
be considered as just or authorized cause for Complainants-
appellees’ dismissal.
More enlightening is the case of Almeda v. Asahi Glass
Philippines. Inc., vs. Asahi Glass Philippines, Inc., G.R. No.
177785, September 3, 2008, where the Supreme Court rules as
follows:
The sole reason given for the dismissal of petitioners
by SSASI was the termination of its service contract
with respondent. But since SSASI was a labor-only
contractor, and petitioners were to be deemed the
employees of respondent, then the said reason would
not constitute a just or authorized cause for
petitioner’s dismissal. It would then appear that
petitioners were summarily dismissed based on the
aforecited reason, without compliance with the procedural
due process for notice and hearing.
Herein petitioners, having been unjustly dismissed
from work, are entitled to reinstatement without loss of
seniority rights and other privileges and to full back wages,
inclusive of allowances, and to other benefits or their
monetary equivalents computed from the time
compensation was withheld up to the time of actual
reinstatement. Their earnings elsewhere during the periods
of their illegal dismissal shall not be deducted therefrom.
Having settled that respondent MDR is a mere labor-only
contractor and considered merely as an agent of the Respondent-
appellant, the termination of the agreement to provide manpower
services cannot be considered a just or authorized cause to
dismiss herein Complainants-appellees as regular employees.
The effect of such termination would have been different had
respondent MDR been able to prove its status as a legitimate job
contractor. In such case, the termination employment is simply
brought about by the expiration of employment contract.
22. Having failed to establish compliance with the
requirements of termination of employment under the Labor
Code, the dismissal of Complainants-appellees was tainted with
illegality. Respondent-appellant and respondent MDR are
therefore, solidarily liable for the rightful claims of Complainant’s-
appellees.
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23. Consequently, Complainants-appellees are entitled to
reinstatement without loss of seniority rights, and other privileges
and to their full backwages inclusive of allowances and to their
other benefits or their monetary equivalent computed from the
time their compensation was withheld up to the time of their
actual reinstatement. However, if reinstatement is no longer
feasible, as in this case considering that Respondent-appellant’s
property manager has actively sought the services of other
manpower service thereby replacing respondent MDR, separation
pay equivalent to one month salary for every year of service shall
be awarded as an alternative (Big AA Manufacturer v. Antonio, G.R. No.
160854, March 3, 2006).
24. Lastly, Respondent-appellant submits that only
complainant Joseph C. Mausig signed the verification. This, to
Respondent-appellant, is fatal to Complainants-appellees’ case.
We do not agree with Respondent-appellant.
25. The ruling in Altres vs. Empleo, G.R. No. 180986,
December 10, 2008, which was reiterated in the recent case of
Fuji Television Network, Inc., vs. Espiritu, G.R. No. 204944-
45, December 03, 2014, is enlightening. The Supreme Court
therein stated:
For the guidance of the bench and bar, the Court
restates in capsule form the jurisprudential
pronouncements . . . respecting non-compliance with the
requirement on, or submission of defective, verification and
certification against forum shopping:
1. A distinction must be made between non-
compliance with the requirement on or submission of
defective verification, and non-compliance with the
requirement on or submission of defective certification
against forum shopping.
2. As to verification, non-compliance therewith
or a defect therein does not necessarily render the
pleading fatally defective. The court may order its
submission or correction or act on the pleading if the
attending circumstances are such that strict compliance
with the Rule may be dispensed with in order that the ends
of justice may be served thereby.
3. Verification is deemed substantially complied
with when one who has ample knowledge to swear to
the truth of the allegations in the complaint or petition
signs the verifcation, and when matters alleged in the
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petition have been made in good faith or are true and
correct.
4. As to certification against forum shopping, non-
compliance therewith or a defect therein, unlike in
verification, is generally not curable by its subsequent
submission or correction thereof, unless there is a need to
relax the Rule on the ground of “substantial compliance” or
presence of “special circumstances or compelling reasons.”
5. The certification against forum shopping must
be signed by all the plaintiffs or petitioners in a case;
otherwise, those who did not sign will be dropped as parties
to the case. Under reasonable or justifiable
circumstances, however, as when all the plaintiffs or
petitioners share a common interest and invoke a
common cause of action or defense, the signature of
only one of them in the certification against forum
shopping substantially complies with the Rule.
6. Finally, the certification against forum shopping
must be executed by the party-pleader, not by his counsel.
If, however, for reasonable or justifiable reasons, the party-
pleader is unable to sign, he must execute a Special Power
of Attorney designating his counsel of record to sign on his
behalf
Applying these guidelines to the present case, particularly,
those stated in paragraphs 3 and 5 highlighted above, there was
also substantial compliance with the verification and certification
against forum shopping requirements.
It is undisputed that complainant Joseph C. Mausig is not a
lone building technician of Respondent-appellant but is a co-
worker thereof with his eight (8) co-complainants. As such, he is
“one who has ample knowledge to swear to the truth of the
allegations in Position Paper” and is therefore qualified to “sign
the verification” attached thereto in view of paragraph 3 of the
above-said guidelines.
After considering that the verification of a pleading or the
position paper, as in this case, is only a formal, not a
jurisdictional requirement, the Honorable Commission may waive
strict compliance with the rules.
26. Following paragraph 5 of the guidelines as afore-stated,
there was also substantial compliance with the certification
against forum shopping requirement, notwithstanding the fact
that only complainant Joseph C. Mausig signed the same.
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Under reasonable or justifiable circumstances - as in this
case where the Complainants-appellees share a common interest
and invoke a common cause of action or defense - the rule
requiring all such petitioners to sign the certificaticon against
forum shopping may be relaxed. In the instant case,
Complainants-appellees share a common interest and defense
inasmuch as they collectively claim a right not to be
dismissed without just or authorized cause and after proper
notice and hearing. The commonality of their stance to defend
their property right of employment thus gave complainant Joseph
C. Mausig authority to inform the Labor Tribunal in behalf of
other Complainants-appellees that they have not commenced any
action or claim involving the same issues in another court or
tribunal, and that there is no other pending action or claim in
another court or tribunal involving the same issues.
Similar to the rules on verification, the rules on forum
shopping are designed to promote and facilitate the orderly
administration of justice; hence, it should not be interpreted with
such absolute literalness as to subvert its own ultimate and
legitimate objectives (Bautista v. Causapin, Jr., A.M. No. RTJ-07-2044, June 22,
2011). Such rule does not prohibit substantial compliance with the
rules under justifiable circumstance, as in this case.
27. Notably, under the 1987 Constitution and Section 3 of
the Labor Code, the State is bound to protect labor and assure
the rights of workers to security of tenure. Likewise, Article 4 of
the Labor Code provides that all doubts in the implementation
and interpretation of its provisions (including its implementing
rules and regulations) shall be resolved in favor of labor. Article
II, Section 18 of the Constitution, on the other hand,
characterizes labor as a primary social economic force; hence, the
State is bound to protect the rights of workers and promote their
welfare. In the same manner, Article XIII, Section 3 of the
Constitution states the workers are entitled to security of tenure,
humane conditions of work, and a living wage. Under these
fundamental guidelines, Complainants-appellees’ right to security
of tenure is a preferred constitutional right that technical
infirmities in labor pleadings cannot defeat.
This is because in labor cases, the deciding authority should
use every reasonable means to speedily and objectively ascertain
the facts, without regard to technicalities of law and procedure.
Technical rules of evidence are not strictly binding in labor cases
(Philippine Telegraph and Telephone Corporation v. NLRC, G.R. No. 80600 March 21,
1990).Thus, even if the verification and certification against forum
shopping is signed only by complainant Joseph C. Mausig, the
fact that all of Complainants-appellees share a common interest
12
and invoke a common cause of action or defense is enough basis
for the Honorable Commission to admit the same.
28. In closing, there is no iota of doubt that the filing of the
present Motion is merely an attempt to delay the payment of the
benefits of the Complainants-appellees. At the risk of being
repetitious, the issues in the case at bar have already been
passed upon by both the Labor Arbiter and the Honorable
Commission. There is no reason to disturb the previous ruling.
Ergo, the Honorable Commission should respectfully do the
inevitable without any second thought, i.e. deny the present
Motion for Reconsideration for utter lack of merit in accordance
with the existing laws, regulations and jurisprudence.
RELIEF
WHEREFORE, Complainants-appellees respectfully pray
that the Honorable Commission issue an Order (i) denying the
present motion; (ii) sustaining its Decision dated April 30, 2018;
and (iii) directing the respondents to pay the Complainants-
appellees the full monetary awards and attorney’s fees.
Other just and equitable reliefs are likewise prayed for.
City of Caloocan for Quezon City, June 11, 2018.
GLENN REY D. ANINO
Counsel for the Complainants-Appellees
IBP No. 022917; 01/03/18; Caloocan City
PTR No. 7002524; 01/03/18; Manila City
Roll of Attorneys No. 66902
MCLE Compliance exempted1
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Contact No. 0905-287-0464
Email: glenn.svd2009@gmail.com
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